IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
SONIA GOKANI, HEMANT M. PRACHCHHAK, JJ.
Prakash Babulal Sheth – Appellant
Versus
Shashikalal Mayur Sheth – Respondent
R/First Appeal No. 1076 of 2019 With Civil Application (For Breach Of Order) No. 1 of 2021
Decided on : 09-12-2022
Foreign Exchange Regulation Act, 1973 – Section 31 – Indian Contract Act, 1872 – Section 215 – Power of Attorney – Suit Property – Appeal arises from judgment and decree passed by trial Court in Regular Civil Suit resulted in form of original plaintiff and original defendant – Held, Court was requested by appellant to direct maintenance of status quo in relation to title possession nature of suit property at time of admission – Learned counsels on both sides to note that disputes between family has not ended amicably as otherwise was proposed deposited any sum pursuant to direction of this Court amount be returned to concerned party with accrued interest – Appeal fails and stands dismissed.
JUDGMENT :
SONIA GOKANI, J.
1. This appeal arises from the judgment and decree passed by the trial Court in Regular Civil Suit No.2245 of 1998, which resulted in form of the original plaintiff and original defendant.
Factual Matrix:
2. Brief facts in capsulized form are as follow:
2.1 The appellants Nos.1 to 3 are the original defendants and the respondent No.1 is the original plaintiff. Respondent Nos.2/1 and 2/4 are the heirs of the deceased defendant No.4 and they are joined after the demise of the original defendant No.4, who is the father of the appellant. Appellants and respondents shall be referred to as the defendant and plaintiff respectively for the sake of convenience hereinafter.
2.3 It is the case of the plaintiff that the suit property was purchased in the year 1990 in her name through power of attorney the defendant No.1. Because of the good family relations, the plaintiff with the consultation of her husband Mr.Mayur Sheth (since deceased) permitted all the defendants including her father-in-law to reside in the said house as defendants did not have personal property to reside. As and when the plaintiffs visited India, they also resided in the same house.
2.4 In the year 1996, when they visited India on 02.12.1996 to attend the marriage of Manushi, the daughter of defendant No.1 which was held on 05.12.1996, some news were received by them regarding the alleged transaction that might be entered by the defendant No.1 regarding the suit property on the basis of the power of attorney which was given to the defendant No.1. Therefore, on 08.12.1996 a letter was issued to the defendant No.1 and sent through the simple post cancellilng the power of attorney. The plaintiff with her husband had left India on 11.12.1996. On 12.12.1996 and 23.12.1996 they had issued the Registered A.D. Notice to the defendant No.1 through learned advocate and along with that also, the very letter issued on 08.12.1996 regarding cancellation of power of attorney was sent.
2.5 Thereafter, on 09.12.1996, the defendant No.1 is alleged to have fraudulently executed two registered sale deeds of suit property in favour of defendant Nos.2 and 3, his wife and son. It is also alleged that the plaintiff had not received any consideration shown in the sale deed. It is alleged that both the sale deeds are fraudulently made, without the consent of the plaintiff and therefore, two suits for cancellation of sale deed and to get back the possession from the defendant No.1 were preferred.
2.6 In the written statement, the defendant No.1 had taken a clear stand that as per the family settlement between defendant No.4 as the father and karta of the family with both his sons i.e. defendant No.1 and husband of the plaintiff, transaction regarding the sale deed in favour of defendant Nos.2 and 3 had taken place. The defendants also narrated the entire background of the family in detail and pointed out that there were many family businesses in which the husband of the plaintiff was actively involved. Because of the financial crunch and the litigation regarding the family business, the family decided to send the husband of the plaintiff Mr.Mayur Sheth to United States of America so that one member can earn handsomely and thereafter can help the family. Even the adoption of Mr.Mayur Sheth by his paternal uncle Mr.Jayantibhai was also a part of the family settlement and it is clear that the plaintiff and her husband resided in a joint family property throughout.
Issues:
3. The trial Court on the strength of pleadings framed the issues and evidence came to be recorded. The following issues were framed and the trial Court answered them as follow:
(2) whether the plaintiff proves that the sale made by the defendant No.1 in favor of defendant No.2 and 3 dated 9-12-96 is illegal and without any authority?
(3)
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A power of attorney does not confer title to property; fraudulent sales executed by an agent without the principal's consent are invalid under the Benami Transactions Act.
The court ruled that a power of attorney does not confer title; fraudulent sales to a power agent's spouse are invalid and do not transfer ownership, reinforcing the principles against benami transac....
Point of law: stoic silence on the part of the plaintiffs for more than 2 years after executing the power of attorney and their own sister being the party to all the subsequent transactions, the thir....
The main legal point established in the judgment is that the Power of Attorney was executed as a security for a loan and the sale deed was executed without consideration, making it void.
Power of Attorney has certain limitations.
Registered Power of Attorney presumed valid under S.114(e) Evidence Act unless fraud specifically pleaded and proved; lack of Tamil literacy and attesting witness ignorance insufficient to invalidate....
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